Government is planning 12% interest on firms to delay the claim of crop

Aug 4, 2018 | 02:22
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In a big step, farmers can get help in crop insurance claims on time, the government has decided to make two major changes in the current Prime Minister Fasal Insurance Scheme (PMFBY).

According to Union Agriculture Minister Radha Mohan Singh, the government has decided to impose a fine on both the insurance agencies as well as the state governments for the delay in payment of claims to the farmers.

According to the proposed changes in new Crop Insurance Scheme norms, if the delay in payment of crop insurance claim exceeds two months then the insurance agencies will have to pay the claim with 12 percent interest on the entire amount.

Similarly, if the state delays in paying its share of the premium on time, the states will also be charged 12% interest. Farmers will be paid the accumulated amount.

Talking to the Millennium Post, Radha Mohan Singh said that the Ministry of Agriculture will soon get approval from Finance Ministry for suggestions on crop insurance. The minister said, "The objective of making a change in crop insurance is to ensure timely payment of claims to the farmers. The government will also encourage states to pay premiums prematurely."

The minister said, "The use of new technologies has tracked the claims payment faster because the payment period has been reduced to six months from the last one year."

To increase the income of farmers, the government increased the minimum support price for Kharif 2018-19 to 1.5 times the cost of production or more.

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